We explain the key parts of your payslip and what to do if you’re not being paid enough.
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Changes this year
Like tax codes, payslips are something we almost all have but few of us completely understand.
Yet understanding your payslip can stop you getting ripped off.
That could include an employer underpaying you, or the taxman or Student Loan Company taking more than their fair share.
Unfortunately, many people don’t get payslips at all, including one in six workers aged under 25 and one in 10 of those aged 25-34, according to a Government survey.
The Department for Business, Energy and Industrial Strategy (BEIS) also found a third of those who got a paycheque didn’t understand it, whilst many young workers did not realise they were entitled to National Minimum Wage.
This year has seen the Government tighten up rules on payslips, with 300,000 people getting one for the first time.
Payslips will also include more details to make it easier for workers to see if they’ve been underpaid.
Here’s how to read your payslip and what to do if you find something wrong.
Minimum wage 2019: how much is it, will I get it and is it rising?
You have a right to a payslip
Are you getting paid enough?
When checking your pay, make sure you take the abovementioned deductions into account (more on those below).
If you still think there’s an error, talk to whoever is responsible for your company’s payroll, or, failing that, your boss.
Also make sure you’re being paid the National Minimum Wage or National Living Wage, which increased on 1 April.
You should be paid the money you’re owed straight away, not on the next payday. Don’t leave it longer than three months or you won't be able to take your employer to a tribunal.
If your employer disputes your claim, then give Acas (the Advisory, Conciliation and Arbitration Service) a call on 0300 123 1100.
Acas gives free, confidential and impartial advice.
They may be able to talk to your employer for you, involve other Government organisations or even advise you on taking your employer to a tribunal.
You can also get support from Citizens Advice.
Deductions
Keep your payslips
If you are emailed your payslip, consider printing them off and storing digital copies on your computer so you have two copies.
Not only are payslips important for challenging your employer, they affect your ability to borrow.
To apply for a mortgage, and some other types of loans, you’ll often be asked for several months’ worth of payslips, to prove your income and time in a job. Credit card applications are less likely to require payslips.
Just make sure you store payslips securely.
A criminal could use the information on your payslip to steal your identity.
Worried about losing your job? Compare income protection policies with Active Quote
Acronyms
To make things even more confusing, payslips tend to be filled with acronyms.
You can find a comprehensive list here, but we've listed the essential ones below.
PAYE – Pay As You Earn; indicates your employer is paying Income Tax directly to the Government
NIC – National Insurance Contributions, one of the deductions you’ll see
PP – Personal Pension, a deduction
SSP – Statutory Sick Pay, not to be confused with
SMP – Statutory Maternity Pay; for fathers look for SPP; Statutory Paternity Pay
To better understand your tax code, read our tax code guide.